Look up ‘retail enforcement pilot’ in google. Put simply, the idea is that local authority inspectors go around businesses with handheld computers asking lots (and at last count I think it was over 100) tick-box questions about regulation. The idea is to reduce the number of regulators visiting businesses, by, for example, getting an Environmental Health Officer to go around ticking boxes for Trading Standards and the Fire Service.

All the data from the box ticking is supposed to then be processed, perhaps triggering other regulatory events, depending of course on which boxes the regulator ticked upon the visit.

The politicans think it is a good idea, the civil servants think it is a good idea and so do the CBI! Personally I think it is a really stupid idea, but it seems to be one of these ‘consensus’ things we were blogging about the other day regarding Afghanistan.

You quite reasonably asked ‘who regulates the regulators’?

Good question adam, and I answer you as a regulator, we are regulated by people with little experience of the real world who seem to make a good living for themselves talking in soundbites and writing in jargon.

2) No wealth – no licence.

3) Ratings company should provide insurance for instruments they do ratings for. As a minimum 5% of the whole investment should be enough for them to avoid costly mistakes (for investors).

This is very closely tied to the world of accountancy. the fiasco of Enron was due to people finding creating ways to keep items off the balance sheet. The creativity circumvented thespecific rules that were in place. In the UK (and Europe), Enron would have broken the general principles about subsiduaries.
The advantage of general principles is that they can allow for situations yet unkown. In the complex world of finance, this can increase the effective control, whilst reducing the complexity and compliance. It enables the regulator stay ahead of the game, whilst reducing the burden on businesses.

I was on a course a few years back on accountancy rules. The tutor gave an illustrative example that helps illuminate the idea.
Imagine having a teenage daughter going for a night out. You could give her a long list of rules about what not to do. Alternatively you could say “You should do nothing that you would not be prepared to tell your parents about the next day”

Currently, there are more European “MiFid” directives than the all the laws enshrined within the entire British legal system, both statutory and common, since 1066 when we were first invaded by the first set of Europeans !

I note these MiFid directives prevent direct marketing of financial products, stop jobs, create costs and paperwork to businesses, along with transfers of much of their operations to places like India.

So the FSA and its lunatic compulsive bureaucratic controls, which is akin to England being under occupation by aliens, has to be dismantled and people who KNOW what they are doing put back to where they are in order to restore sanity, more profit for business, more jobs, less cumbersome and understandable protection for consumers and avoid the dictatorship of MiFid directives from well meaning bureaucrats which don’t have the first foggiest idea of what they are doing when it comes to running a business, policing or advising face to face customers in their homes who can’t grasp the mentality of bureaucrats but would rather have plain old common or garden, good honest ‘advice’ from someone who understands they are real people and not people to put in ‘tick boxes’.

The result is, as you say, box-ticking regulation that causes more inconvenience to ordinary people than to criminals.

(Identity cards will just move the problem around. Instead of the bank being shown fake documents, they will be shown to the passport office. The passport office has the same problem as the bank: a few fraudsters hidden among millions of honest people.)

”
One of the worst blunders ever seen on Whitehall saw a ‘cost-cutting’ computer system end up spouting answers in German and leaving taxpayers with a bill of more than £80million.

A damning report from MPs today accuses the Department for Transport of ’stupendous incompetence’ in its management of a multi-million pound efficiency drive.

It said a programme to save £57million in administration costs had instead left taxpayers facing an £81million bill.

Workers were left struggling with an IT system that issued messages in German, wrongly recorded that staff were off sick and randomly confiscated staff holidays. ”

How are ID cards doing? I read the biometric tech has a 95% efficiency rating when working well, Labour loons think thats a high number, but its not.

who regulates the regulators

Hear, hear!

Obviously the reserve requirement should go up but since this ratio IS THE CAUSE OF INFLATION, then once you win the argument for a higher reserve requirement you win the argument for a 100% reserve requirement. As the reserve requirement is increased, so the severity of the fluctuations in the supply of money is decreased. Always remember that a state has the option of printing money as the demand for it increases without debasing its value. Some would argue that since it is the people that created the demand for the money and therefore the growth of the economy, it is them rather than the banks who should benefit from the creation of money.

The current system based on debt leaves governments powerless to act effectively in a recession in a system where large fluctuations are built in, not created by poor management of the economy.

As long as the fractional reserve system is continued there will continue to be overheating through the oversupply of credit/debt.

Capitalism would work better (and I am a capitalist) under a 100% reserve requirement as it would help to control the economic growth and allow the people to have greater control over their own property.

However, you can only increase the reserve requirement in growth times as to restrict the supply of money at the present time would prevent the supply of credit and worsen the recession. This is exactly what Gordon has done by increasing the captial reserve requirement in a downturn – something about stable doors and horses bolting…

PS. Have you seen that the FSA is recruiting another 260 bods to do more of the bad things they are doing badly and failing at?

I also think we might consider revisiting anti-trust law. At present, these are designed to protect consumers from abuse of market position through pricing. Maybe there’s an argument for restricting the size of commercial entities for public risk reasons? As taxpayers, we are constantly hearing that the banks or the US auto industry are ‘too big to fail’. It seems to me that, for society as a whole, the efficiency benefits of scale are now outweighed by the risks of too many eggs in one basket in a number of sectors, and we should think about breaking up the largest players or otherwise limiting their market share.

I accept that this wouldn’t necessarily solve a problem where everyone in a particular industry acts like a lemming, but it might well give us advance warning or limit the damage.